Citi trims its Facebook (FB, $146.22) price target to $175 from $185, saying 2019 could still be a transition year, with revenue growth headwinds from the Stories transition combined with expense growth that may not peak until the middle of the year.

The firm is forecasting 19% annualized revenue growth over the next three years, along with stabilizing margins in 2020 and beyond.

Goldman Sachs upgrades Proofpoint (PFPT, $89.42) to ‘Buy’ with a price target of $114, saying it likes the stock following last week’s earnings-related sell-off and estimate reset. The firm calls out Proofpoint as a category leader in email security that is growing more than 20%.

KeyBanc upgrades Proofpoint to ‘Overweight’ with a price target of $120. While last week’s 2019 initial guidance disappointed Wall Street, the downside over-reaction in the shares has created a compelling buying opportunity, says the firm.

The move will sharply ramp up the competitive battle in the hybrid cloud infrastructure space, where IBM is playing catch-up to Microsoft (MSFT) and Amazon (AMZN).

Jefferies thinks the “rich valuation” being paid by IBM (enterprise value/trailing 12-month subscription revenue ratio of 12.3x) is likely to keep other potential buyers on the sidelines.

Morgan Stanley says the acquisition reinforces its confidence in the emergence of hybrid cloud architectures as well as the strength of IT spending headed into 2019.

The firm says Red Hat has been Microsoft’s primary competitor within server operating systems, and has generally been taking share. IBM’s longer-term opportunity, or threat to Microsoft, hinges on its ability to execute well and maintain Red Hat’s open source enthusiasm, says Morgan Stanley.

JP Morgan lowers its Alphabet (GOOGL, $1,061) price target to $1,350 from $1,440 following last night’s Q3 earnings report, saying revenue came in a little light, but overall results continue to show that the company’s investments in the business are driving 20%+ growth.

KeyBanc bumps up its Microsoft (MSFT, $107.67) price target to $125 from $123, citing a multi-year model transformation driven by the fast-growing cloud and Internet segments, which the firm estimates could top $70 billion in revenue by calendar 2020, vs. just $18.5 billion in CY’16.

Shares of Shopify (SHOP, $130.68) this morning are up more than 6% after the company—provider of a cloud-based e-commerce platform for SMBs—reports above-consensus Q3 results and offers upside guidance for Q4.

Revenue rose 57% to $270.1 million, beating the consensus of $257.8 million. EPS of four cents topped the consensus by six cents.

Powered by more merchants on the Shopify platform, Subscription Solutions revenue was up 46% to $120.5 million. Merchant Solutions revenue rose 68% to $149.5 million, driven by GMV, along with Shopify Capital and Shopify Shipping.

GMV in Q3 advanced 55% to $10 billion. GPV of $4.1 billion was 41% of GMV processed, vs. 37% in the year-ago period.

Wedbush reiterates its Microsoft (MSFT, $106.99) price target of $140, saying it believes the shift to the cloud is a major secular trend that is significantly benefiting the software giant. The firm expects cloud strength in Azure and Office 365 to continue into 2019.

Wedbush is seeing a clear inflection point in the field, as more enterprises and government agencies make the transformational move to a hybrid cloud architecture, with Microsoft making a major partner push on the SMB front.

Needham starts Pivotal Software (PVTL, $18.73) at ‘Buy’ with a price target of $25, calling out the company as a key enabler for enterprises to become “software first.”

Pivotal is a provider of a cloud-native platform that allows developers to skip the undifferentiated requirements of application development, says the firm.

The company’s core offering—Pivotal Cloud Foundry—packages all of the services necessary to build an application (including runtime containers, middleware services, load balancing, network routing and operating systems) on a single platform, reducing the required, but mundane and often redundant tasks for developers.

Survey results from Piper Jaffray show that the Instagram unit of Facebook (FB, $154.84) has overtaken Snapchat as the most-used platform by teen monthly active users, and continues to lead social platforms as a channel for brand communications.

Wedbush starts Zscaler (ZS, $37.75) at ‘Outperform’ with a price target of $48, calling the company a “disruptive first mover” in cloud security, with an innovative product umbrella and strategic focus.

The firm thinks cloud security is in its very early innings of success, and believes Zscaler is one of the best plays in the sector.

MKM Partners maintains its ‘Buy’ rating on Marvell Technology (MRVL, $18.40), saying there are “various upside drivers”—including AI and 5G technologies—that could end up making current guidance conservative.

The firm also calls out a discounted valuation relative to the peer group average. MKM keeps its MRVL price target at $27.

Baird starts FireEye (FEYE, $17.81) at ‘Outperform’ with a price target of $22, calling it a top pick in the security & infrastructure software space.

The firm likes the vision laid out by FireEye management around an automated platform for detection, response and remediation, but admits the company’s turnaround story “seems to be stuck in second gear.”

Oppenheimer starts MongoDB (MDB, $68.94) at ‘Outperform’ with a price target of $80.

The firm expects MongoDB to take advantage of secular themes emphasizing the importance of new database architectures. OpCo sees the company gaining share in a large and growing dynamic database market.

MongoDB shares are down from the all-time high of $85.25 reached in the middle of September.

Twilio (TWLO, $69.45) announced last night that it would acquire SendGrid (SEND, $33.04), a cloud-based email marketing vendor, in an all-stock transaction valued at about $2 billion. The exchange ratio is 0.485. The deal is expected to close in the first half of 2019.

SendGrid’s email API will be added to the Twilio communications platform. The combination of Twilio and SendGrid will have 100,000+ customers and an annualized revenue run rate of more than $700 million.

Twilio shares this morning are off more than 8% on the news. Baird sees the weakness as a buying opportunity, reiterating its price target of $82. The firm is positive on the long-term opportunity because it thinks the SendGrid acquisition offers a strong strategic fit.

Goldman Sachs calls out multiple signs of rapidly slowing consumer demand in China, which the firm thinks increases risk to demand for Apple (AAPL, $218.79) products. The firm says much of its view of Apple’s upside potential was centered on Chinese demand for larger screen sizes.

While the offsetting positive trend of 6”+ phone conversions is helping, Goldman believes Apple’s potential to “beat and raise” is likely reduced should weak consumer demand persist in China.

Goldman maintains its AAPL price target of $240, but has a ‘Neutral’ rating on the shares.

Canaccord upgrades Square (SQ, $72.85) to ‘Buy’ and raises its price target to $90 from $60, saying the recent pullback in the shares creates a long-term opportunity in a “truly disruptive and well-run company.”

The firm sees the departure of CFO Sarah Friar as more about her going to a promising company as CEO, not her walking away from a risk.

Nomura Instinet agrees, telling investors to focus on the company’s results, not the CFO. The firm does not believes Friar’s departure will disrupt the “innovation engine” behind the company.

Macquarie upgrades Microsoft (MSFT, $108.51) to ‘Outperform’ with a price target of $121 based on ample higher-growth drivers, including public cloud and a gaming services platform.

The firm says Microsoft has been differentiating Azure in several critical ways, such as being both enterprise-friendly and aggressive in layering in unique/incremental services—including AI, Stack, Sphere and a broad focus on edge computing.

JP Morgan adds Dropbox (DBX, $23.30) to the Analyst List, maintaining its price target of $35. While not convinced the “seven-day-old growth tech sell-off is over,” the firm sees an improving risk/reward balance on Dropbox shares and potential for 30% to 50% outperformance.

JP Morgan believes investors are “underestimating the stability and consistency of the Dropbox engine” and are overlooking the launch and adoption of the company’s Premium plans.

Dropbox shares are down sharply from the post-IPO high of $43.50 reached in June.

KeyBanc says a “Big Chill” has set in during the first nine days of October for the 55 largest SaaS stocks. The group is down 11% so far this month and is off 21% from the highs, on average, says the firm.

KeyBanc notes the group had an incredible run through the end of Q3, with multiple expansion levels—as measured by forward EV/S—increasing by two full turns above the five-year average.

Among the high quality SaaS stocks the firm would buy on the October pullback: Shopify (SHOP, $138), Salesforce (CRM, $144), Twilio (TWLO, $73.70), BlackLine (BL, $45.15) and Zendesk (ZEN, $62.18).

DA Davidson starts The Trade Desk (TTD, $134.24)—provider of a software platform used to manage digital ad campaigns—at ‘Buy’ with a price target of $158, calling out two “compelling” near-term strategic growth opportunities for the company:

Citi raises its Apple (AAPL, $224.29) price target to $265 from $230 based on higher ASPs and stronger gross margin given the consumer preference for higher memory configurations of iPhones coupled with the new falling memory prices.

Given the current overwhelming negative sentiment surrounding the company, the firm says it sees a low bar for Q3, even if OpEx is higher than Wall Street expectations. OpCo adds engagement levels and monetization appear strong enough.

Goldman Sachs remains upbeat on FireEye (FEYE, $17.27) after attending the company’s annual Cyber Defense Summit, which the firm says saw the strongest showing in three years.

The firm maintains its price target of $22, while arguing FireEye shares could double if the company can gain just 200 basis points of market share in the endpoint and SIEM markets.

Goldman says FireEye would need to improve its Helix business with on-prem integration as well as provide “better messaging to the channel.” The firm expects FireEye to move forward with a renewed scale push next year once the integration is complete.

Oppenheimer likes FireEye’s longer-term product strategy with Helix as well as the existing opportunity with “spoke” products such as Endpoint and Email Security, where the company has continued to expand capabilities up the stack. OpCo maintains its FEYE price target of $22.

Bernstein believes Amazon (AMZN, $1,971) will be an accelerant of the disruption it sees coming to the healthcare sector.

The firm thinks Amazon is developing a series of business strategies for entering segments of the healthcare market. Bernstein sees most disruption taking place in the online pharmacy and digital consumer healthcare niches.

The firm says Intel has “squandered its manufacturing lead, “ forcing the company to face “a costly battle to retain share amidst a near-term slowing of its end market.”

RBC Capital says Intel is prioritizing the production of its Xeon and Core processors to maintain it position in the high-performance segments of the PC market. The firm expects solid growth in datacenter and IoT to help offset PC headwinds.